Highway

Public-private partnerships (PPPs) are often viewed as the ideal solution for governments balancing limited budgets and growing infrastructure demands. However, as the failure of some high-profile toll-highway PPPs illustrates, implementing such projects is often not as straightforward as many governments envision. One of the most common factors contributing to these failures is traffic volumes that turn out to be significantly different from what was originally forecast.

In February 2015, Conexión Pacífico 3 (CP3) highway project, reached financial close. This USD 648m project is the first to reach financial close in Colombia’s ambitious fourth generation (4G) infrastructure programme, seen by many as one of the most important infrastructure procurement initiatives in Latin America.

Increases in oil production and lower projected global demand growth for crude oil have contributed to declines in fuel prices, beginning in June 2014 and falling 70% to the lowest point in January 2016. However, the impact of changing fuel prices is not uniform across transportation modes. For instance, in India, retail fuel prices have declined by only 20-25% as a result of the central government increasing the excise duties to shore up its fiscal performance.

The PR-22/PR-5 concession project in Puerto Rico has recently won PFI magazine’s 2011 Americas Deal of the Year and Steer Davies Gleave was the traffic and revenue advisor to the successful consortium of Abertis and Goldman Sachs.